Institution: The trade negotiations between Europe and the United States are approaching a critical period. If an agreement cannot be reached, it may be postponed again

ChainCatcher news, the French Foreign Trade Bank stated that if no agreement is reached between the EU and the US by August 1, the EU will take the first round of countermeasures in retaliation. In addition, the European Commission is also formulating a second set of countermeasures.

Previously, in the latest macroeconomic forecast for the Eurozone by staff, the impact of a "severe scenario" was estimated to be a general 20% tariff imposed by the US on all goods, followed by reciprocal retaliation from the EU. This scenario is expected to lower the Eurozone's GDP annual growth rate by 0.4 percentage points in 2025 and 2026 compared to the baseline scenario. If the US raises tariffs on EU goods to 30% and the EU retaliates accordingly, the loss to the Eurozone's GDP will be even more significant, with an expected decrease of about 0.5 percentage points in 2025 and about 0.6 percentage points in 2026 compared to the baseline scenario.

However, the French Foreign Trade Bank still believes that, although the likelihood is low, there is still a chance for successful negotiations before August 1. Otherwise, under pressure from Europe, especially from the market and US businesses, the "deadline" may be postponed again.